Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. time value of money: basics using the equations an

Time Value of Money: Basics Using the equations and tables in Appendix 12A of this...

80.2K

Verified Solution

Question

Accounting

Time Value of Money: Basics Using the equations and tables in Appendix 12A of this chapter, determine the answers to each of the following independent situations.

Round answers to the nearest whole number. (a) The future value in three years of $1,000 deposited today in a savings account with interest compounded annually at 4 percent. $ Answer

(b) The present value of $8,000 to be received in two years, discounted at 12 percent. $ Answer (c) The present value of an annuity of $9,000 per year for three years discounted at 10 percent. $ Answer (d) An initial investment of $17,241 is to be returned in eight equal annual payments. Determine the amount of each payment if the interest rate is 8 percent. $ Answer (e) A proposed investment will provide cash flows of $20,000, $6,000, and $6,000 at the end of Years 1, 2, and 3, respectively. Using a discount rate of 14 percent, determine the present value of these cash flows. Year 1 $ Answer Year 2 $ Answer Year 3 $ Answer (f) Find the present value of an investment that will pay $3,000 at the end of Years 10, 11, and 12. Use a discount rate of 12 percent. $ Answer

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students